Feb. 17 (Bloomberg) -- Air Arabia PJSC, whose profit beat estimates, fell the most in six months on bets this year’s gains in the Middle East’s biggest no-frills airline were overdone.
Shares of the carrier, which is based in the United Arab Emirates sheikhdom of Sharjah, dropped 2.7 percent, the most since Aug. 12, to 89 fils at the close in Dubai. The stock was the second-most traded on Dubai’s DFM General Index, which fell 0.2 percent. About 34 million of the company’s shares were traded, almost triple the three-month daily average.
Air Arabia’s stock rallied 3.2 percent last week, taking the airline’s 14-day relative strength index above 70, a level that indicates to some investors that a security is poised to drop. The company, whose shares are gained 9.6 percent this year excluding today, said yesterday 2012 profit jumped 56 percent to 420 million dirhams ($114 million), beating the 404 million-dirham average estimate of eight analysts compiled by Bloomberg.
“A lot of investors had already priced in the results and there’s some profit-taking,” said Waleed Al Khateeb, Dubai-based senior finance manager at Daman Securities LLC.
The carrier proposed a dividend of 7 fils a share. Five analysts recommend investors buy the stock, while six have a hold rating on the shares and one advises on selling them, according to data compiled by Bloomberg.
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